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The Week Ahead: Berkeley building on London’s boom

 

Laura Chesters
Sunday 01 September 2013 20:02 EDT
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Today

The average deposit for first-time buyers in London has hit an all-time high of £64,000 and the price of a London home shows no sign of reaching a peak. For those companies building houses in the capital this is a pretty good situation.

Housebuilder Berkeley Group will update the market and analysts at Peel Hunt think it will report “further robust trading”. It unveiled plans to return about £1.7bn in cash to investors in 2011 over a 10-year period due to the strong returns from its London portfolio and investors will be keen to know if there is any more detail on this. Peel thinks there is a “possibility it will make a further commitment” on this today. One thing it might face is shareholder anger at its remuneration report; the shareholder adviser Pirc has criticised the company’s long-term incentive scheme ahead of the AGM.

Results/Updates: Biome Technologies, Berkeley Group, Michelmersh Brick.

Tomorrow

Investment in projects at the Basingstoke-based producer of bull and pig sperm Genus will mean its profit might only be up by 3 per cent, Peel Hunt predicts. Soaring animal feed prices may also have hurt the group, which will report its full-year results tomorrow. The key will be the company’s outlook. Peel expects the group will have a more positive tone as “commodity prices have improved and feed costs are falling” which will reduce Genus’s cost and encourage farmers to step up their investment in genetics. Consensus for the full-year 2014 is profit of £54m but Peel expects a full-year pre-tax profit of £48m.

Results/Updates: Alumasc, Dechra Pharmaceuticals, DS Smith, Goals Soccer Centres, Hydro International, Johnson Service Group, McBride, Total Produce.

Wednesday

Now AIM stocks can be put in ISAs more punters might be looking at what stocks to invest in, especially as interest on savings is so weak. Investment “supermarket” Hargreaves Lansdown is gearing up to a new phase of its business in line with the new Retail Distribution Review. Hargreaves shares have risen more than 60 per cent in the past 12 months but analysts at Morgan Stanley think it has further to go. They raised their price target to 1,050p, from 759p ahead of the final results on Wednesday. Morgan Stanley thinks it is “a high-quality franchise, strategically well placed and supported by structural growth in the UK savings market” and thinks it will take market share. Analysts at Numis forecast a 26 per cent growth in pre-tax profit to a record £193.1m.

Results/Updates: Ashtead Group, Abbey Protection, Hargreaves Lansdown, Kofax, Mucklow, Safestore Holdings, Smart Metering Systems, SQS Software Quality Systems, Staffline Recruitment.

Thursday

Selling electrical products on the high street sounds like an impossible task in the face of internet competition but Dixons somehow still manages to not make it look hopeless. Analysts at Oriel Securities think its first-quarter update on Thursday may reveal it has been hit by the hot July weather as shoppers stayed away. It will have benefited from the demise of rival Comet and Oriel thinks trade has bounced back in August. The shares have advanced significantly as investors already factored in the benefit of the disappearance of Comet; they are up around 50 per cent this year. Oriel still thinks it is worth a buy and thinks its plan to reduce losses will generate earnings growth in the next three years.

Results/Updates: Aer Lingus, Betfair, Dixons Retail, easyjet, Go-Ahead, Mail.ru, Monitise, Spirit Pub Company, Supergroup.

Friday

The temporary jobs market is driving recruitment group SThree’s growth. Analysts at Numis predict its temp book to be up 4 per cent quarter on quarter. They also think its move in to different sectors such as energy and pharmaceuticals will have helped its performance for the third quarter. Analysts at Espirito Santo rate it a buy and think management has been doing a good job on restructuring.

Results/Updates: Belgravium Technologies, SThree.

Economics diary

Today

Hometrack housing survey, purchasing managers’ index – manufacturing.

Tomorrow

British Retail Consortium – year-on-year sales figures, purchasing managers’ index – construction, EU GDP, US construction spending .

Wednesday

Official reserves data, Halifax house-price survey .

Thursday

Bank of England interest-rate announcement, MPC rate statement, new car registrations data, G20 meetings, US unemployment claims.

Friday

Industrial-production data, manufacturing-production data, Bank of England/GfK – inflation-data predictions, trade figures.

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